How Democrats Broke GOP Block on Financial Reform

It looked like bad news for Democrats when a Senate test vote to
begin formal debate on financial regulatory reform failed due to unified
GOP opposition. Republican senators even came up with their own version
of the plan, which some pundits read as a sign they didn't plan on
cooperating with the Democratic bill. But now Senate Minority Leader
Mitch McConnell, citing a "key agreement," suggests Republicans will no
longer block debate. What does this mean? How did Democrats get the
Republicans to come around?

Dems Planned to Force GOP's Hand
Talking Points Memo's Brian Beutler reports on
the unusual Democratic plan. "Frustrated by an ongoing
campaign by the GOP to block debate on financial reform legislation,
Democrats plan to hold the Senate floor open all night, potentially
holding repeated votes to break the filibuster, or forcing Republicans
to publicly object to debating their bill."

GOP Won Changes to
Final Bill National Review's Daniel Foster writes, "It
looks like there will be Republican-urged changes to the resolution
authority, but that talks about changes to the sprawling consumer
protection agency went nowhere. ... This seems to clear the way for a
liberal/centrist Republican or two to reverse course, vote for cloture,
and get some sleep tonight."

McConnell said
that Democrats have agreed to close “loopholes” in a provision setting
up the fund that would have allowed federal officials to draw on
taxpayer dollars to wind down a troubled institution. Republicans argued
these provisions would have put tens of billions in federal funds at
risk for future bailouts. Democrats said all the money in the fund would
be supplied by banks, likening it to a “pre-paid funeral account” for
big institutions.

Dodd and Shelby Reached Agreement The Plum Line's Greg Sargent says it all came down to Democratic Senator
Chris Dodd and Republican Senator Richard Shelby, who lead the Senate
Banking Committee. "Dodd’s confirmation that he may be willing to reach a
deal with Shelby
on 'too big to fail bailouts,' or on the bank liquidization fund, may
leave Republicans little choice but to allow this to go to a debate, the
aide says. That’s because this was one of the primary sticking points
for many Republican Senators."

Partisan Divide Far From
Bridged Time's Jay Newton-Small reminds
us, "At the same time, several issues remain outstanding, as
McConnell notes. Those talks have broken down and will likely have to be
hashed out on the floor, if they can be. The Republican conference will
be meeting at 4:30pm today to discuss how best to proceed."

Credit the Kentucky Derby The Washington Post's Ezra Klein posits, "if the
Democrats are serious about forcing the Republicans to really filibuster
the bill, this is the right week for it: The Kentucky Derby starts
Friday, and Kentucky's senior senator, Mitch McConnell, would surely
prefer to attend. Given that his members are already
talking about breaking ranks, McConnell may find himself eager to
get this kabuki dance over with a little bit early."

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